BTC’s Privatisation Committee Chairman Says Actual Sale of Company Underway

BTC privatization committee chairman T. B. Donaldson addresses a luncheon meeting of the Bahamas Chamber of Commerce on Thursday at the British Colonial Hilton. (BIS PHOTO/Letisha Henderson)

Nassau, Bahamas -- The requisite groundwork for the privatisation of BTC has been completed and according to T.B. Donaldson, Committee Chairman responsible for the privatisation of BTC, “the actual sale of the company is now underway”. 

Mr. Donaldson addressed a luncheon meeting of the Bahamas Chamber of Commerce at the British Colonial Hilton on Thursday to provide an update on the process and progress of the privatisation exercise.

“The keen investor interest in BTC,” said Donaldson, “coupled with the need to move the sector ahead quickly, will undoubtedly ensure that BTC will indeed be privatised in the near future.”

He assured Chamber members that if there is a “pause” in the move toward the privatisation of BTC as a result of the economic downturn, it will be a “very temporary” one.

Mr. Donaldson acknowledged that since 1998, The Bahamas has been on a path toward the privatisation of BTC, formerly BaTelco. He said the Government of The Bahamas recognised that the time for the privatisation of BTC and the “liberalisation” of the sector is past due.

The ultimate goal of the privatisation of BTC, said the committee chairman, is to create an efficient and competitive market for communications. “A marketplace where consumer choice and a progressive regulatory regime ensure that citizens and residents of our country obtain world class service at the best possible prices,” he said.

This interplay, said Donaldson, will decrease costs for businesses and residents and ensure that the economy benefits from the most modern, cutting edge technology available. “With an economy based upon the trade of international services, the provision of low cost, high value communications services is paramount to the long term development needs of the country.”

Mr. Donaldson told the business community that successive governments of The Bahamas have taken BTC “as far as they possibly can”.

“BTC must now compete in an environment now dominated by massive multi-national telecommunications operators,” he added.

“BTC must be freed of the constraints of public sector ownership if it hopes to position itself to survive and to compete in a liberalised communications sector.”

The chairman noted that the Government has recognised that an improved regulatory framework is required to establish a “functioning, fluid and modern” telecommunications sector.

As a result, he said the privatisation committee and relevant public entities are working to revise and restructure the legislation and regulatory regime to ensure that the new rules are “modern, transparent and robust”.

The privatisation committee, established in February of this year by Prime Minister the Rt. Hon. Hubert Ingraham, comprises eight members who represent the private and public sector. Mr. Donaldson said the committee was mandated to provide advice and recommendations to the government before the end of 2008 on the following:

1. The sale of a material stake (now determined to be 51%) of BTC to a strategic partner of sufficient experience and track record in the sector
2. The facilitation of broad public awareness and consultation of stakeholders as appropriate in respect to this exercise
3. The engagement of professional assistance as required
4. The full liberalisation of the telecommunications sector, inclusive of the legal and regulatory adjustments that must accompany the liberalisation

Mr. Donaldson pointed out that the government accepted the committee’s recommendations that the sale of BTC should be divided into an advisory process and a sales process.

The committee engaged KPMG Corporate Finance Co. to oversee the advisory process by performing an assessment of the financial, legal and technical aspects of BTC’s operations. He said early next week the regulatory recommendations of the committee will be presented in a public consultation document.

Furthermore, he said the committee will soon release a “teaser” document that will begin the sales process. “…we are all too keenly aware that the sale of BTC does not take place in a vacuum away from the realities of unsettled global financial markets and uncertain macro-economic prospects worldwide.

“The privatisation committee must assess as an element of its recommendations to Government, the whole issue of the timing of the sale, so as to ensure that a depressed world market does not undermine the fair market value of the company nor does it dissuade promising prospects from participating in this process,” added Mr. Donaldson.

By: Kathryn Campbell